US Dollar broadly softened

Pound Sterling

With the Federal Reserve implementing further monetary easing the US Dollar broadly softened, allowing the Pound to achieve a six-week high against its American rival. Sterling’s advance was aided by a better-than-forecast employment report for the UK, but the British currency did drop against a bolstered Euro. US data, including this afternoon’s significant advance retail sales statistics, could cause movement in the Pound today.

The Pound is presently trading against the Euro in the region of 1.2344 and is trading against the US Dollar in the region of 1.6129

US Dollar

The American national bank’s decision regarding a new round of quantitative easing pushed the US Dollar lower against several of its most traded peers, including the Pound, Australian New Zealand and Canadian Dollar’s and Euro. Against fellow safe-haven currency the Japanese Yen the ‘Greenback’ managed to hit an eight-month high as speculations mount concerning the likelihood of the Bank of Japan stepping up monetary easing. Of particular interest today is US core retail sales and PPI figures. Both are forecast to come in lower than last month and if these predictions prove accurate the US Dollar’s bearish trend could continue.

The US Dollar is presently trading against the Pound in the region of 0.6199 and is trading against the Euro in the region of 0.7643

Euro

The Euro continued to trade higher against the majority of its contemporaries yesterday as the US Dollar weakened and German sentiment data improved the Eurozone’s outlook. The common currency was then able to climb further (posting particular gains against the ‘Greenback’) after EU finance ministers reached a speedy decision regarding banking supervision for the 17-nation currency bloc. The publication of the European Central Bank’s monthly report is likely to be the biggest cause of movement in the Euro today.

The Euro is presently trading against the Pound in the region of 0.8097 and is trading against the US Dollar in the region of 1.3062

Australian Dollar

The Federal Reserve’s decision to boost the US economy through a new round of monetary easing caused Australian bonds to fall and the Australian Dollar to rise. The ‘Aussie’ was trading at an almost three-month high against its US counterpart. Gaining global equities lent the South Pacific currency further support while tomorrow’s Chinese manufacturing data, which is expected to show positive movement, could push the Australian Dollar higher still.

The Australian Dollar is presently trading against the Pound in the region of 0.6538, is trading against the Euro in the region of 0.8073 and is trading against the US Dollar in the region of 1.0547

New Zealand Dollar

Although New Zealand manufacturing figures revealed a slight contraction in activity in November the New Zealand Dollar still soured to a four-year high against the safe-haven Japanese Yen as the Federal Reserve announced their intention to start a new round of bond buying. The ‘Kiwi’ was also able to benefit from the political situation in Japan and continued to trade higher against the US Dollar and British Pound.

The New Zealand Dollar is presently trading against the Pound in the region of 0.5235, is trading against the Euro in the region of 0.6448 and is trading against the US Dollar in the region of 0.8440

Canadian Dollar

The Canadian Dollar was another currency able to benefit from the Fed’s decision to start a new round of monetary easing. The ‘Loonie’ ended trade higher against the US Dollar than it began, increasing by 0.15 of a US cent. The commodity driven Canadian Dollar also benefited from higher crude oil prices. The most volatile piece of Canadian data scheduled for release today is the nation’s new housing price index.

The Canadian Dollar is presently trading against the Pound in the region of 0.6308, is trading against the Euro in the region of 0.7785 and is trading against the US Dollar in the region of 1.0172

 

Richard Martin
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After working in business development for a major UK currency brokers for several years, Richard left Britain to help set up the company’s Australian office and now lives and works in Queensland; making the most of his new Down-Under lifestyle.